Pomerantz Law Firm Files Class Action Against ODDITY Tech

Lawsuit alleges company misled investors about advertising partner issues impacting customer acquisition costs

Mar. 13, 2026 at 4:00am

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Pomerantz LLP has filed a class action lawsuit against ODDITY Tech Ltd. (NASDAQ: ODD) and certain officers, alleging the company made materially false and misleading statements about its business, operations, and prospects. The lawsuit claims ODDITY failed to disclose that an algorithm change by its largest advertising partner diverted ads to lower quality auctions at higher costs, significantly increasing customer acquisition costs and negatively impacting the company's financial outlook.

Why it matters

The lawsuit highlights the risks companies face when relying heavily on advertising partners, whose algorithm changes can significantly impact customer acquisition costs and financial performance. It also underscores the importance of transparent and accurate disclosures to investors, especially around factors that can materially affect a company's business.

The details

The class action lawsuit, filed in the U.S. District Court for the Southern District of New York, alleges that throughout the class period from February 26, 2025 to February 24, 2026, ODDITY made false and misleading statements about its business. Specifically, the complaint claims the company failed to disclose that an algorithm change by its largest advertising partner diverted ads to lower quality auctions at abnormally high costs, substantially increasing ODDITY's customer acquisition costs and negatively impacting its financial prospects.

  • The class period runs from February 26, 2025 to February 24, 2026.
  • Investors have until May 11, 2026 to seek to be appointed as lead plaintiff in the class action.

The players

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What they’re saying

“we experienced a dislocation in our account with our largest advertising partner that we believe was driven by algorithm changes which diverted us to lower quality auctions at abnormally high costs”

— Oran Holtzman, Chief Executive Officer

“Given the dislocation we are experiencing in acquisition costs, we expect first quarter 2026 revenue to decline approximately 30% year-over-year, but we hope to see material improvement in the second half of 2026.”

— Lindsay Drucker Mann, Global Chief Financial Officer

What’s next

The judge will decide by May 11, 2026 whether to appoint a lead plaintiff for the class action lawsuit.

The takeaway

This case highlights the risks companies face when relying heavily on third-party advertising platforms, whose algorithm changes can significantly impact customer acquisition costs and financial performance. It underscores the importance of transparent disclosures to investors about factors that can materially affect a company's business.